Natural Gas Weekly Update

Today in Energy

Recent Today in Energy analysis of natural gas markets is available on the EIA website.

Market Highlights:

Prices

• Henry Hub spot price: The Henry Hub spot price fell 13 cents from $1.57 per million British thermal units (MMBtu) last Wednesday to $1.44/MMBtu yesterday.
• Henry Hub futures price: The April 2024 NYMEX contract expired Tuesday at $1.575/MMBtu, down 12 cents from last Wednesday. The May 2024 NYMEX contract price decreased to $1.718/MMBtu, down 13 cents from last Wednesday. The price of the 12-month strip averaging May 2024 through April 2025 futures contracts declined 9 cents to $2.728/MMBtu.
• Select regional spot prices: Natural gas spot prices fell at most locations this report week (Wednesday, March 21 to Wednesday, March 27). Price changes ranged from a decrease of $1.14 at Algonquin Citygate to an increase of 21 cents at the Waha Hub.
• • Natural gas prices in the Northeast fell this report week despite a drop in temperatures across the region. At the Algonquin Citygate, which serves Boston-area consumers, the price fell $1.14 from $2.66/MMBtu last Wednesday to $1.52/MMBtu yesterday. In the Boston Area, temperatures averaged 37°F, which was 7°F lower than the previous report week, leading to 195 heating degree days (HDDs), 50 HDDs more than last week and 23 HDDs above normal. Residential and commercial sector consumption in New England rose 36% (0.5 billion cubic feet per day [Bcf/d]), and natural gas consumption by the electric power sector rose 26% (0.2 Bcf/d) to meet higher space heating demand. The arrival and discharge of a liquefied natural gas (LNG) cargo at Constellation Energy's Everett LNG terminal in Boston, Massachusetts, provided additional natural gas supply to the region. At the Transcontinental Pipeline Zone 6 trading point for New York City, the price decreased 36 cents from $1.73/MMBtu last Wednesday to $1.37/MMBtu yesterday. In the New York-Central Park area, temperatures averaged 42°F this report week, 10°F lower than last week, leading to a total of 160 HDDs, up 70 HDDs from the previous report week and 21 HDDs above normal. Residential and commercial sector consumption in New York and New Jersey rose 48% (1.6 Bcf/d) this report week, according to data from S&P Global Commodity Insights, due to the colder weather, driving almost all of the increase in consumption.
  • The price at the Waha Hub in West Texas, which is located near Permian Basin production activities, remained negative this week at -$0.05/MMBtu yesterday, up 21 cents from last Wednesday. The Waha Hub traded $1.49 below the Henry Hub price yesterday, compared with last Wednesday when it traded $1.83 below the Henry Hub price. The Waha price reached an intraweek low of -$0.70/MMBtu on both Friday, March 22, and Monday, March 25. The Waha price has been negative since March 11 due to a combination of warmer weather that has reduced natural gas consumption and ongoing maintenance on the El Paso Natural Gas pipeline system, which delivers gas westbound out of the Permian Basin.
  • Natural gas prices in the Midwest fell this report week. At the Chicago Citygate, the price decreased 24 cents from $1.54/MMBtu last Wednesday to $1.30/MMBtu yesterday. Prices in the Midwest remain at historic lows for this time of the year. Temperatures in the Chicago Area averaged 39°F this report week, 3°F lower than the previous report week and 3°F below normal, resulting in 177 HDDs, 13 HDDs more than normal. Temperatures rose later in the report week, averaging 44°F between March 24 and March 27, which was 10°F higher than the average between March 21 and March 23 and 2°F higher than the weekly normal average temperature. In the Midwest, consumption in the residential and commercial sector rose 12% (0.9 Bcf/d) this report week, according to S&P Global Commodity Insights, which drove most of the 7% (1.0 Bcf/d) regional increase in consumption.

  Daily spot prices by region are available on the EIA website.

• International futures prices: International natural gas futures price changes were mixed this report week. According to Bloomberg Finance, L.P., weekly average front-month futures prices for LNG cargoes in East Asia increased 21 cents to a weekly average of $9.48/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands decreased 11 cents to a weekly average of $8.74/MMBtu. In the same week last year (week ending March 29, 2023), the prices were $12.72/MMBtu in East Asia and $13.47/MMBtu at TTF.
• Natural gas plant liquids (NGPL) prices: The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 10 cents/MMBtu, averaging $7.49/MMBtu for the week ending March 27. Ethane prices rose 3%, while natural gas prices at the Houston Ship Channel fell 6%, widening the ethane premium to natural gas by 11%. The ethylene spot price was essentially unchanged week over week, and the ethylene/ethane premium fell 1%. Propane prices rose 3%, Brent crude oil prices were essentially unchanged, and the propane discount to crude oil narrowed by 5%. Normal butane prices rose 2%, Isobutane prices rose 1%, and natural gasoline prices fell 2%.

Supply and Demand

• Supply: According to data from S&P Global Commodity Insights, the average total supply of natural gas rose by 0.3% (0.3 Bcf/d) compared with the previous report week. Dry natural gas production decreased by 0.4% (0.4 Bcf/d) to average 101.0 Bcf/d, and average net imports from Canada increased by 19.8% (0.7 Bcf/d) from last week.
• Demand: Total U.S. consumption of natural gas rose by 6.3% (5.1 Bcf/d) compared with the previous report week, according to data from S&P Global Commodity Insights. Natural gas consumed for power generation fell by 0.4% (0.1 Bcf/d) week over week. Industrial sector consumption increased by 1.8% (0.4 Bcf/d) week over week. In the residential and commercial sectors, consumption increased by 18.3% (4.8 Bcf/d) driven by below-average temperatures across most of the country. Natural gas exports to Mexico decreased 1.4% (0.1 Bcf/d). Natural gas deliveries to U.S. LNG export facilities (LNG pipeline receipts) averaged 12.9 Bcf/d, unchanged from last week.

Liquefied Natural Gas (LNG)

• Pipeline receipts: Average natural gas deliveries to U.S. LNG export terminals were unchanged from last week, averaging 12.9 Bcf/d, according to data from S&P Global Commodity Insights. Natural gas deliveries to terminals in South Louisiana and Texas were unchanged, averaging 8.8 Bcf/d and 2.9 Bcf/d, respectively. Freeport LNG, south of Houston, Texas, has returned one train to service and taken two offline for maintenance and anticipates operating with only one liquefaction train until May. Natural gas deliveries to terminals outside the Gulf Coast were also flat at 1.2 Bcf/d.
• Vessels departing U.S. ports: Twenty-two LNG vessels (seven from Sabine Pass; four each from Calcasieu Pass and Corpus Christi; three from Cameron; two from Elba Island; and one each from Cove Point and Freeport) with a combined LNG-carrying capacity of 80 Bcf departed the United States between March 21 and March 27, according to shipping data provided by Bloomberg Finance, L.P.
• Vessels arriving at U.S. ports: One LNG vessel with a carrying capacity of 3 Bcf docked for off-loading at the Everett LNG terminal in Boston Harbor in Massachusetts between March 21 and March 27, according to shipping data provided by Bloomberg Finance, L.P.

Rig Count

• According to Baker Hughes, for the week ending Tuesday, March 19, the natural gas rig count decreased by 4 rigs to 112 rigs. The Haynesville dropped four rigs, the Marcellus dropped one rig, and one rig was added among unidentified producing regions. The number of oil-directed rigs fell by 1 rig from the Permian region to 509 rigs. The total rig count, which includes 3 miscellaneous rigs, decreased by 5 rigs, and it now stands at 624 rigs, 134 fewer rigs than last year at this time.

Storage

• Net withdrawals from storage totaled 36 Bcf for the week ending March 22, compared with the five-year (2019-2023) average net withdrawals of 27 Bcf and last year's net withdrawals of 55 Bcf during the same week. Working natural gas stocks totaled 2,296 Bcf, which is 669 Bcf (41%) more than the five-year average and 430 Bcf (23%) more than last year at this time.
• According to The Desk survey of natural gas analysts, estimates of the weekly net change to working natural gas stocks ranged from net withdrawals of 24 Bcf to 40 Bcf, with a median estimate of 30 Bcf.
• The average rate of withdrawals from storage is 25% lower than the five-year average so far in the withdrawal season (November through March). If the rate of withdrawals from storage matched the five-year average of 0.7 Bcf/d for the remainder of the withdrawal season, the total inventory would be 2,302 Bcf on March 31, which is 669 Bcf higher than the five-year average of 1,633 Bcf for that time of year.

See also:

• Natural Gas Analysis Reports
• Short-Term Energy Outlook

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